If there is a dispute about the amount involved it is important for the Authority's Contract Manager to raise the issue with the Contractor promptly. The amount that is not in dispute should be paid according to the normal schedule. In turn the Contractor should respond promptly to the Authority (through its Contract Manager) on the dispute so that the matter can be settled quickly between the parties or referred to Dispute Resolution Procedure (DRP) if required.
The WIDP Contract (Clause 45.5) gives the Authority ten Business Days to notify the Contractor of the dispute and the amount disputed and to provide such evidence as the Authority may have to demonstrate that the amount is not due to the Contractor. The Contractor has five Business Days to respond to the Authority notice. If the Contractor does not respond or if it agrees with the Authority then the Authority can retain the amount permanently and claim interest on any overpayment made.
If the Contractor does not agree then the matter goes to DRP. If the amount disputed is then found to be payable then the Authority is obliged to pay interest on the amount until it is paid at the interest rate prescribed in the Contract. Equally if the DRP determines in the Authority's favour it is entitled to claim interest on any overpayment made.
The Contract Management Manual needs to include clear procedures for identifying disputed amounts promptly and raising the disputes with the Contractor within the time limits set out in the Contract. A separate decision will also be needed as to whether to withhold the amount disputed or to pay it upfront and then seek to recover interest on the overpayment.